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Well, in Sydney we are. As I believe they are in places like Vancouver and San Francisco.
You need government policies to assist people to convert the equity to help with retirement income. Just this week (our financial year runs from July 1st) a policy has come in allowing some of the proceeds of selling a house to be rolled into superannuation beyond the normal limits (Super are specific tax friendly retirement accounts)
If it works it may encourage older people to sell up and move out of the main cities, freeing some housing for younger people. Up until now, doing so can leave too much money over, causing people to lose some or all of the government pension through the assets test.
But people move away much less than in previous generations. Many of us help with childcare of grandchildren as well as supervise the very frail very elderly parents. At least if people can downsize without disadvantage get themselves itnwill be worthwhile.
We are unlikely to have such government policies here in the U.S. in the next 2-3 years and possibly 7-8 years.
These numbers appear to be averages. They mean nothing if you or your spouse find yourself needing care for an extended period of time. I have personally known a number of elderly people like this.
Exactly. The average is irrelevant, as you either need it or you don't. A better way to look at it is as follows: given that you need it, what is the distribution of prices you'll see at that point in time, and what is, say, the 85th percentile of prices at that point in time? Then, of course, modify it for risks -- such as the risk of inflation, the risk of our government imposing some form of "luxury tax" on consumption of such "Cadillac care," etc.
I used to worry about retirement..ALOT. We max our Roth IRA, wife has a state pension that will be like 80% of her income plus full health coverage for the both of us, I'm starting a new job with a solid 401k plan, We live in a big expensive home in NJ that we'll sell one day and move away to downsize so that'll prob be another $200K.. And we're now buying rental property.. Point is, we are probably over doing it by a lot.
Instead of saying "we're gonna retire with $7,000,000" we've been looking at retiring with $3.5million just 10 years early.
Rule of thumb is a 4% withdraw which is really only $40,000 a year on $1mil and you gotta hope it doesn't run out. If you're close to retirement and unsure if thats enough you may wanna think about being a landlord or something in your "free time"
We have been liquidating as much real estate as can. Last thing we want to be is landlords in retirement . We dont want to get involved with tenants and have their problems become our problems. We want only liquid investments that have all the issues go away instantly with the click of a mouse , not 6 months in housing court.
No matter how you screen tenants the big three will always be there divorce,illness and job loss
Youngster here too, but I feel like I have a past generation mind. I'd rather just work until I'm unemployable. The statement, "work til you drop" that my dad lives buy is my basis. I'm doing my travel while I'm younger whilst socking away 28% of my income.
I also like, "no one has ever said they wish they had less money".
And no one has also ever said "I wish I worked MORE."
Work is overrated.
At 28%, there is no reason you shouldn't be able to retire in your late fifties, early sixties, if not SOONER.
I’m shooting for 10mm but I’m sure I could make it on 1mm alone. I wouldn’t want to make that attempt however so I will try and stick to my plan
I'm shooting for 20mm but I'm sure I can make it on less than 1mm alone since billions of people have done it for a very long time. However I will stick to my plan because 1 vacation house isn't enough.
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